(1) What is the Educational Choice for Children Act (ECCA)?

​

H.R.833 / S.292 or the Educational Choice for Children Act (ECCA) is a Federal Scholarship Tax Credit and represents the most ambitious school choice legislation in Congress, aimed at expanding educational opportunities in all 50 states. The legislation is sponsored by Representatives Adrian Smith (R-NE) and Burgess Owens (R-UT) and Senators Bill Cassidy (R-LA) and Tim Scott (R-SC) and creates scholarships funded by private donations to non-profit scholarship granting organizations (SGOs) in the states. Donors receive a 100% non-refundable tax credit.
 

Why do we need it?
 

School choice has made historic progress across more states than ever, but too many families are locked out of opportunity because their state legislatures are controlled by an education establishment that does not prioritize the needs of K-12 families. We need school choice in every state, which is what ECCA would ensure.

The specifics:
 

• The credits are $10 billion annually. Corporate donors may contribute 5% of their taxable income; individual donors may contribute up to 10% of their adjusted gross income or $5,000, whichever is greater. The bill includes an automatic 5% escalator if 90% of the credit cap is reached.

• Each state is guaranteed access to up to $20 million in tax credits if SGOs can raise the funds, then it is first- come, first-serve. Students in all 50 states and Washington, D.C. can benefit.

• Students in grades K-12 in every state and every school setting are eligible. The income threshold is set at 300 percent of median gross income by region as determined by the U.S. Department of Housing and Urban Development. This would cover 85% – 90% of K-12 students in every state.

• SGOs determine the individual amount of scholarship awards and uses which include tuition, tutoring, education technology, on-line courses, curriculum, fees, homeschool expenses, or special needs services.
   

The ECCA has no role for the U.S. Department of Education and contains no federal mandates on states, school districts, schools or homeschool families. SGOs must complete an annual audit and register with the Treasury Department.

How Does the ECCA Help Students?

When funding for education follows students to the school of their choice, families win. All parents should have a wide range of high-quality educational options to choose from, regardless of income, which is the opportunity school choice unlocks. ECCA will help parents of up to two million students choose the school or education service that works best for their child. In states with existing private school choice offerings, the ECCA scholarship can be stacked on top of the state offering, increasing purchasing power for parents and helping more students. In states that lack these options, the ECCA will create educational opportunity for those K-12 parents and students. Students attending public, private, magnet, charter, micro, on-line, or homeschools all could benefit.

​​

​​​

(2) What is The Tax Cuts and Jobs Act (Sec. 1202)?​​

​

(a/k/a 529 Education Plans)

​

The Tax Cuts and Jobs Act of 2017 (Sec. 1202) consolidates and modifies several provisions regarding education savings accounts to replace Coverdell savings accounts with modified rules for tax-exempt qualified tuition programs (known as 529 plans). 

​​

The Bill modifies 529 education savings plans to allow the plans to distribute up to $10,000 in expenses for tuition incurred during the taxable year in connection with the enrollment or attendance of the designated beneficiary at a public, private, or religious elementary or secondary school. The $10,000 limitation applies on a per-student basis for distributions from all 529 accounts. 

​

Your 529 tax-exempt donation of $10,000 will provide a Education Freedom Scholarship for an economically disadvantaged designated student to attend a New innovative career and technical education (CTE) high school in Brooklyn, New York.